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Sell or Process Furthe Zing Coffee Company produces Columbian coffee in batches of 5,500 pounds. The standard quantity of materials required in the process is

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Sell or Process Furthe Zing Coffee Company produces Columbian coffee in batches of 5,500 pounds. The standard quantity of materials required in the process is 5,500 pounds, which cost $6.00 per pound. Columbian coffee can be sold without further processing for $8.40 per pound. Columbian coffee can also be processed further to yield Decaf Columbian, which can be sold for $11.00 per pound. The processing into Decaf Columbian requires additional processing costs of $14,250 per batch. The additional processing will also cause a 6% loss of product due to evaporation. a. Prepare a differential analysis report for the decision to sell or process further. Zing Coffee Company Proposal to Process Columbian Coffee Further Differential Analysis Report Differential revenue from further processing per batch: $6870 46,200 Revenue from sale of Decaf Columbian Revenue from sale of Columbian coffee Differential revenue Differential cost per batch: Additional cost of producing Decaf Columblan 14,250 Differential loss from further processing Decaf Columbian per batch 3,580

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